Hi! My name is Thijs and as the name probably gave away: I'm Dutch. Moved to Melbourne 2 years ago with my Kiwi girlfriend and absolutely love it here. We're both 30 and blessed with pretty good jobs. instead of wasting our money on things we don't need or having a bank account that loses money every year, we're looking at investing for the long term. We're not looking to buy something for ourselves. That would require us to take on more debt than we're comfortable with at this point and being as new to Australia as we are, we're not sure where we'll be 5 years from now either. We don't want to lock ourselves down yet. Our preference currently is towards the concept or rentvesting, with the idea of starting out with lower value rental properties in rural areas to understand how it all works and keeping the mortgage period short. I understand it won't give us the maximum possible return, but as you can probably tell, we're pretty risk averse. At least at this point. I'll be reading up a lot in the upcoming period and might ask some questions, but now at least you know a little about me and my background. Thanks for having me!
Welcome Thijs. Look around and ask as many questions as you can that will help you learn. Good luck on your investing journey.
Hi @Thijs Welcome to PC! I understand your concern about being risk averse... however, on the flip side, what sort of return is an OK return? What if the rural properties don't provide an upside?
Hi and welcome from another Dutchie! Here's a small something to make you feel welcome. Keep reading and speaking to people on the forum - while it seems like a good idea to keep the loan term of your first investment short, if you don't have a home yourself you might shoot yourself in the foot if you pay off the investment loan too quickly. Being risk averse isn't an issue, its just a matter of planning ahead so you know you're covered if something should go wrong. It's important to not let fear stop you from buying a quality investment though - sometimes things that seem 'safe' or low risk bite in different ways. For eg, with a regional/rural IP you may find that capital growth is slow, repairs are expensive, and if it's a super cheap IP, that repairs cost you a fortune as a % of property value and quickly eat up the additional cashflow.
Thanks for the warm welcome everyone! Hagelslag indeed! What would you consider super cheap? We're currently looking around the $150k mark because that would allow us to easily put 10 to 20% down and pay off in 5 years, although we'd probably look at around 10 years and put the difference in a savings account for a rainy day or decide to pay it all off sooner. The idea for a property in that price class is because the rent would be around $250, whereas if you go towards a $400k property your rent would only be about $450 per week (8.67% vs 5.85% gross yield). Anyways, I'll open my own thread and write down the plan for everyone to shoot at. Thanks!
